With all that actionable advice in mind, let’s go through some essential tips to help you implement that in practice:

You never know for sure which one of those links really matters for rankings (both for Google and Yahoo). You can make educated guesses (numerous SEO tools can help) but you can never be sure.

First and foremost, we build links for Google but are forced to rely on Yahoo (or independent sources, like Linkscape and Majestic SEO).

Secondly, the real algorithm is a mystery even for most advanced experts: you are never sure how much value can be passed through some link.

Not all competitors’ links should be pursued: don’t waste your time on:

links that flow within one network of sites (we are pretty much sure that this tactic is old, dangerous and low-effective but these links are still numerous) – be sure to recognize those links (here are some tips on discovering networks of sites);

links that were paid for: I for one avoid pursuing links on a website that clearly states they are paid-for-review or selling/exchanging links – chances are they are or will be under radar – so why risk?

links that appeared as the result of an exchange: just don’t waste your time there…

Keep an eye for “time-wasters”:

same-domain links;

nofollowed links;

directory links;

multiple links from closely related sites (see site networks), etc.

How you are going to spot those links depends on the tool you choose: with Linkscape you can filter those links out; Majestic SEO uses flags for some of those link types and with Yahoo you will need to use tools.

Some of your competitors’ tactics might have been a really bad idea. Sometimes you find multiple duplicated site reviews distributed throughout a low-quality blog or article directory network or overwhelming number of blog comment “Great post” spam – even if your competitor seems to be doing well (thanks to or rather despite) those backlinks, that doesn’t mean you should do that too.